definitions. A factory could be compliant under one law and non-compliant under another. Small businesses struggled with paperwork; large corporations complained of rigidities. Workers too found themselves navigating a maze when they needed wage claims, compensation, or social security benefits.

In that sense, consolidation was necessary. The Codes bring uniform definitions, create common registers, allow digital compliance, and widen the scope of social security to include gig and platform workers—something no previous law had attempted. For a gig workforce that now exceeds 80 lakh workers, this is a progressive acknowledgment of new-age labour realities.

However, the apprehensions expressed by trade unions, labour economists, and rights groups are equally grounded in reality. Much of the criticism centres not on the idea of reform, but the direction in which the reforms are moving—toward greater employer flexibility but reduced worker protection.

Take the Industrial Relations Code, which raises the threshold for prior government permission for layoffs and retrenchments from 100 workers to 300. The government argues that this will encourage firms to grow, hire more workers, and avoid staying artificially small. But workers fear that easier retrenchment will create a climate of insecurity, especially in manufacturing sectors where contract workers already dominate.

The introduction of fixed-term employment, without corresponding safeguards, risks normalising short-term, disposable labour. In a country where job security is already rare, the Codes may inadvertently push more workers into precarious forms of employment.

The Wage Code, while promising standardised definitions, has another unintended effect: the restructuring of salary components. By mandating that at least 50% of total pay must constitute “wages,” companies may reduce allowances and reconfigure take-home salaries. Early estimates suggest that many workers could see a drop in monthly take-home pay, even though long-term benefits like PF contributions increase. For families living paycheck to paycheck, this shift feels less like reform and more like a setback.

Perhaps the biggest worry lies with the Social Security Code, which expands the concept in theory but leaves many specifics to delegated legislation. Gig workers have been included, but without clearly defined employer liability—an approach that looks progressive on paper but weak in enforceability.

Another layer of complexity comes from federalism. Since labour is a concurrent subject, states must draft their own rules. Some states have prepared progressive frameworks; others have proposed rules that weaken protections further. The result is a looming landscape of uneven implementation, where a worker’s rights depend heavily on where they live.

Underlying all this is the fear that these reforms were fast-tracked during the pandemic years without adequate consultation. Many unions say they were not meaningfully heard. Public debate was muted. And although the Codes are still not fully operational, the anxiety has already permeated India’s labour market.

None of this is to suggest that labour reform is unnecessary. India desperately needs an efficient, modern labour framework that encourages investment while protecting dignity at work. But reform cannot mean that the burden of “ease of doing business” is shifted entirely onto the shoulders of workers.

The real measure of labour reform is whether it balances growth with justice. The Labour Codes, at this moment, appear to tilt the scales too far towards employers. Unless governments recalibrate implementation by strengthening social security, ensuring job security, and

preventing misuse of fixed-term contracts, the promise of reform may quickly turn into the reality of regression.

In the world’s fastest-growing major economy, workers should not be paying the price for efficiency. Reform must not come at the expense of rights.